In re Marriage of McCormick, No. A07-1638 (Minn. App. 10/7/2008)
| Decision Date | 07 October 2008 |
| Docket Number | No. A07-1638.,A07-1638. |
| Parties | In re the Marriage of: Sarah A. McCormick, petitioner, Respondent, v. David L. McCormick, Appellant. |
| Court | Minnesota Court of Appeals |
Appeal from the District Court, Hennepin County, File No. 27-FA-000299465.
Sarah A. McCormick, (pro se respondent)
John Garrett Westrick, Westrick & McDowall-Nix, PLLP, (for appellant)
Considered and decided by Halbrooks, Presiding Judge; Huspeni, Judge;* and Muehlberg, Judge.**
UNPUBLISHED OPINION
Appellant challenges the district court's dissolution judgment with respect to the valuation and division of the parties' marital homestead and the denial of conduct- or need-based attorney fees. Because we conclude that the district court did not clearly err in its determination of the homestead's value or abuse its discretion in its denial of attorney fees to appellant, we affirm in part. But because we conclude that the district court's decision to award 100% of the marital equity in the parties' homestead to respondent was an abuse of discretion, we reverse in part and remand on that issue.
Appellant David McCormick and respondent Sarah McCormick were married in 1994. They have three children. M.D.M. and M.S.M. are nine-year-old twins; E.R.M. is seven years old. Appellant is an attorney, but his license to practice law was suspended at the time of the dissolution proceedings based on his failure to pay certain debts to the Minnesota Client Security Board. Before the parties' separation, respondent stayed home full-time, caring for their children—in particular, M.S.M., who has autism. Respondent petitioned to dissolve the parties' marriage in the spring of 2005.
During their marriage, appellant and respondent purchased a home in Minneapolis. The home was originally encumbered by first and second mortgages, totaling approximately $148,000. Appellant alone handled the family finances during the marriage, including payment of the two mortgages. In addition to the mortgages, appellant took out a home-equity loan in the amount of $22,000 in April 2000. The district court found that respondent had no knowledge of the home-equity loan until after the parties' separation.
Subsequent to filing her dissolution petition, respondent learned that their home was in foreclosure due to appellant's failure to pay the mortgages. Respondent obtained an advance on her inheritance from her parents and paid $148,243.46 to satisfy both mortgages. Respondent subsequently learned that appellant had also failed to make payments on the home-equity loan. This failure resulted in additional foreclosure proceedings being initiated against the homestead. To again prevent the home from being foreclosed on, respondent borrowed an additional $15,637.59 (the remaining balance due on the home-equity loan) from her father at a 6% per annum interest rate and redeemed the property.
Several months after the dissolution proceedings were initiated, the parties reached a settlement, partially resolving the division of the marital homestead. The terms of the settlement provided that respondent would be awarded title to the property subject to a lien in favor of appellant. The district court stated that it would determine the amount of appellant's lien at a later date.
The settlement was incorporated into a September 2005 partial judgment and decree. The district court made the following factual finding in this partial judgment:
The homestead has a FMV of approximately $350,000 and is currently in foreclosure. The parties have agreed that this homestead will be transferred to [respondent], subject to the [appellant's] lien. The Court shall retain jurisdiction to determine the total amount of [appellant's] lien, if any, following an appraisal, considered in light of the property and debt allocation of the parties.
The district court's order also included the following conclusion of law:
2. That the [respondent] is awarded all right, title, equity and interest in and to the homestead of the parties, . . . subject to the [appellant's] lien; this Court retains jurisdiction to determine the total amount of [appellant's] lien. The [appellant] shall execute a Quit Claim Deed transferring his interest in the property to the [respondent] within 10 days of the entry of this Judgment and Decree.
Trial was held in October 2006, on the issues of custody, child support, spousal maintenance, parenting time, and the remaining aspects of the property division. The district court issued a final judgment and decree on March 30, 2007. In the final judgment, the district court valued the parties' homestead at $302,000. In apportioning the equity in the homestead, the district court did not divide the marital share in the property equally; instead, it awarded all of appellant's marital share in the homestead (approximately $44,000) to respondent. In addition, the district court denied appellant conduct- or need-based attorney fees related to the cost of litigating the value of the homestead at trial.
Appellant moved to amend portions of the final judgment, including the district court's determinations relating to the valuation of the homestead, the apportionment of the homestead's marital equity, and attorney fees. The district court issued an amended judgment on July 31, 2007, in which it altered several factual findings and conclusions of law that are not relevant to this appeal but reaffirmed its determinations of the homestead's valuation, division of marital equity, and denial of attorney fees. This appeal follows.
Appellant argues that evidence demonstrates that the homestead should be valued at $350,000, instead of the $302,000 figure that the district court determined. A district court's valuation of an asset is a finding of fact that will not be set aside unless it is "clearly erroneous on the record as a whole." Hertz v. Hertz, 304 Minn. 144, 145, 229 N.W.2d 42, 44 (1975); see also Minn. R. Civ. P. 52.01. We require district courts to come to reasonably accurate valuations. McIntosh v. McIntosh, 740 N.W.2d 1, 6 (Minn. App. 2007). Appellate courts do not reweigh the evidence that was before a district court and will defer to a district court's credibility determinations. Sefkow v. Sefkow, 427 N.W.2d 203, 210 (Minn. 1988); Gada v. Dedefo, 684 N.W.2d 512, 514 (Minn. App. 2004).
Here, ample trial evidence supports the district court's valuation of the homestead at $302,000. The home was purchased in August 1996 for $155,000. The district court used a valuation date of June 2005, when the parties separated and the case-management conference was held. A Hennepin County Property Tax Statement was introduced indicating that the estimated fair-market value of the parties' residence, for taxes payable in 2005, was $302,000. The estimated fair-market value for taxes payable in 2006 was $347,500. In the opinion of Kent Stein, an appraiser who was hired by both parties in 2005 to perform an appraisal, the fair-market value of the property was approximately $300,000.
Appellant attacks Stein's qualifications on the grounds that he was a licensed appraiser but not a certified appraiser and that Stein could have used other comparable values that would have resulted in a higher valuation of the parties' home. We note, as did the district court, that Stein's appraisal was reviewed by a supervisory certified appraiser. And assessing the credibility of the licensed appraiser's testimony is a matter for the district court.
It is not the province of this court to reconcile conflicting evidence. On appeal, a [district] court's findings of fact are given great deference, and shall not be set aside unless clearly erroneous. . . . If there is reasonable evidence to support the [district] court's findings of fact, a reviewing court should not disturb those findings.
Fletcher v. St. Paul Pioneer Press, 589 N.W.2d 96, 101 (Minn. 1999) (citation omitted).
Appellant also argues that a 2006 property tax statement and documentation from the parties' mortgage company indicate that the fair-market value of the homestead was approximately $350,000. But again, weighing conflicting evidence and assessing its credibility is the province of the fact-finder, not an appellate court.
Finally, appellant argues that the district court had already determined the value of the homestead at $350,000 in the partial judgment. But appellant's argument ignores a significant word in the partial judgment: approximately. The district court was explicitly approximating, rather than conclusively setting, the value of the homestead. Indeed, the district court stated in the partial judgment that it was awaiting an appraisal, in part to help determine "the total amount of [appellant's] lien, if any." As the district court noted in its final judgment and decree, "This language indicates that the [p]artial [j]udgment and [d]ecree did not fix the value of the homestead." Because the district court had sufficient evidence to support its determination that the value of the parties' homestead is approximately $302,000, its factual finding to this effect is not clearly erroneous.
Both parties used nonmarital funds in the purchase of the homestead—appellant $10,000 and respondent $5,000. In assessing the marital and nonmarital equities in the homestead, the district court applied the Schmitz formula to determine the growth of each party's nonmarital contribution to the homestead. See Schmitz v. Schmitz, 309 N.W.2d 748, 750 (Minn. 1981). The district court determined that appellant's nonmarital share is $18,120 and that his marital share of the homestead is $44,225.68 for a total of $62,345.68. The district court based its division of marital property on Minn. Stat. § 518.58 (2006), stating that
Pursuant to Minn. Stat. § 518.58, the Court must make "a...
To continue reading
Request your trial